By Ben Fox Rubin and Tess Stynes
Entergy Corp.'s (ETR) third-quarter profit fell 46% as the power
company was hurt by weak demand and declining revenue as well as
impacts from a year-earlier tax settlement benefit.
The company earlier this month warned that its quarterly
earnings would fall short of market expectations due to higher
non-fuel operation and maintenance expenses, as well as
substantially higher income taxes.
Entergy owns utilities in Arkansas, Louisiana, Mississippi and
Texas, and also sells power on the wholesale market, where prices
have fallen to historic lows, driven by low natural-gas prices.
The company plans to spin off its electric-transmission business
and merge the operation with ITC Holdings Corp. (ITC). Entergy has
been pursuing regulatory approvals to switch grid operators in
connection with the deal.
Entergy reported a profit of $342.7 million, down from $633.1
million a year earlier. On a per-share basis, which reflects
preferred dividend impacts, earnings were down at $1.89 from $3.53
a year earlier. Excluding decommissioning expense, asset
write-downs and other items, adjusted earnings were $1.95. The
company recently projected $1.94 a share in adjusted earnings.
Revenue fell 13% to $2.96 billion, below estimates of $3.42
billion from analysts polled by Thomson Reuters.
Earnings at its utilities business shrank 43% amid a prior-year
benefit from a tax settlement that mostly was recorded at the
utility. The wholesale commodities business reported profit fell
8.8%.
Total electricity sales volume was down 4.4% amid broad declines
across its businesses.
For 2013, the company projected per-share earnings of $4.60 to
$5.40, in line with analysts' average estimates of $5.26.
Write to Tess Stynes at tess.stynes@dowjones.com
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